EX-99.1 3 e14918ex99_1.txt PRESS RELEASE Exhibit 99.1 SERENA Software, Inc. San Mateo, CA 94403-2538 Tel 650-522-6600 Fax 650-522-6699 www.serena.com SERENA [LOGO] FOR IMMEDIATE RELEASE --------------------- Contact: SERENA Software, Inc. FRB | Weber Shandwick Robert I. Pender, Jr. Karen Keating Chief Financial Officer (415) 248-3434 (650) 522-6604 SERENA SOFTWARE REPORTS FIRST QUARTER RESULTS EPS of $0.17 and License Revenue Growth of 12% Over a Year Ago SAN MATEO, CA - May 22, 2003 - SERENA Software, Inc. (Nasdaq: SRNA), an industry-leading supplier of software that automates change to enterprise code and content, announced today net income per diluted share, excluding amortization of intangible assets, of $0.17 for the first fiscal quarter ending April 30, 2003. License revenues, total revenues and operating and net income, excluding intangibles amortization, all grew in excess of 10% over the first fiscal quarter a year ago. Total revenues of $24.4 million in the first quarter of fiscal 2004 represented an 11% increase over first quarter of fiscal 2003. Software licenses revenue was $10.9 million, an increase of 12% over last year's first quarter. Maintenance revenue was $11.9 million and services revenue was $1.6 million. License revenue from software change management was 71% of license revenue, with 23% of license revenues coming from distributed systems platforms. Excluding intangibles amortization, operating income for the first quarter ended April 30, 2003 was $9.5 million, up 18% over the first quarter a year ago. Operating margin excluding intangibles amortization was 39%, up from 36% in the same quarter last year. Excluding intangibles amortization, net income and net income per diluted share for the first quarter increased 12% and 13%, respectively, to $6.9 million and $0.17 from $6.1 million and $0.15 in the first quarter of fiscal 2003. Net income and net income per diluted share computed in accordance with generally accepted accounting principles increased 16% and 17%, respectively, to $5.8 million and $0.14 from $5.0 million and $0.12 in the same quarter a year ago. Cash flow from operations in the quarter was $11 million and cash and investments at April 30, 2003 was a record $196 million or $4.78 per diluted share. Total deferred revenue increased 8% sequentially to $37.1 million. Days Sales Outstanding improved to 52 days from 57 days in the fourth quarter. -more- The Company also announced guidance for the second quarter of fiscal 2004 including the results of the recently completed TeamShare Inc. acquisition as of the closing date. For the second quarter total revenues are expected to be in the range of $26 to $27 million and net income per fully diluted share excluding intangibles amortization is expected to be between $0.17 and $0.18. "By any metric we had a very solid quarter in what remains a challenging environment," said Mark Woodward, CEO and President. "We had our first big win in the federal government space and we continue to grow our distributed systems business. With the acquisition of TeamShare and our continued solid execution I am looking forward to a successful fiscal 2004." First Quarter Highlights o Announced that R.J. Reynolds selected Serena ChangeMan DS for their development environment, to build on their enterprise-wide change management strategy and vision. o Partnered with Relativity Technologies to combine Serena ChangeMan ZDD with RescueWare, a solution that helps companies streamline and improve the modernization process. o Announced the Serena Alliance Partner Program to leverage System Integrator and Government Channels. o Received validation for Serena ChangeMan DS support of WebSphere Studio Version 5, a solution that accelerates next generation development and increases the quality of business-critical applications. o Announced a comprehensive Comparex solution for DB2 conversions to help companies efficiently migrate from legacy to DB2 databases o Advanced in ranking to #22 on the San Francisco Business Times' list of the 25 largest Bay area software companies. o Reported customer satisfaction level findings that 99.1% of customers are likely to recommend Serena and 97.8% rank Serena's performance equivalent to or much better than the competition. o Announced that Serena was awarded a GSA schedule contract, strengthening ECM solution government offerings. ImmixGroup will maintain the GSA contracto o Announced a global reseller agreement with ASG, granting ASG rights to sell and market the Serena StarTool Product Suite, creating new market opportunities for Serena and strengthening ASG's solution offering. -more- o Announced that Serena elected Documentum CEO, Dave DeWalt, to the Board of Directors strengthening and increasing the Board's independent membership. o Announced that Serena ranks #7 for best return on sales and #11 for biggest ratio of market value to sales on the San Jose Mercury News' SV150 list. o Announced extended support for Microsoft Windows Server 2003 and Visual Studio.Net 2003 in ChangeMan DS, enabling organizations to streamline next-generation development. o Announced a partnership with Aspen Software consultants, where Aspen will recommend Serena ECM solutions and provide implementation services to their customer base, enabling Serena to extend partner channels and better meet customer needs. o Announced a partnership with ECMS, where ECMS will recommend and implement Serena ECM solutions and services to their customer base, enabling Serena to further extend partner channels and provide better support to customers. o Announced a partnership with Corporate Consulting Services, where CCS will recommend and implement Serena ECM solutions and services to their customer base, enabling Serena to further extend partner channels and provide better support to customers. Commentary Available A conference call to discuss the first quarter results is scheduled for 2:00 PM Pacific time today and may be accessed live via the Internet at www.companyboardroom.com or www.serena.com. A replay of the webcast will be available for 7 days. Additionally investors can listen to the call by dialing (800)-240-4186 or (303) 262-2190 at least 5 minutes prior to the start time. A replay of the call will be available through May 29, 2003 by dialing (303) 590-3000 or (800) 405-2236 access code 538402#. About SERENA Software, Inc. SERENA Software Inc. is the Enterprise Change Management (ECM) industry leader. For over twenty years Serena has focused exclusively on providing application change management solutions to the world's leading enterprises, and today its products are in use at over 2,750 customer sites - including 42 of the fortune 50. Serena leads the way in ECM by providing a single point of control to manage software code and Web content changes throughout the enterprise, from the mainframe to the Web. Serena is headquartered in San Mateo, California and maintains international offices in Canada, Germany, France, Benelux and the United Kingdom. Serena can be reached through the World Wide Web at www.serena.com. This press release contains "forward-looking statements" under the Private Securities Reform Act of 1995. There can be no assurance that future results will be achieved, and actual results could differ materially from forecasts and estimates. Factors that could cause or contribute to such differences include, but are not limited to, our reliance on our mainframe products for revenue; the percentage of license revenue typically closed at the end of each quarter making estimation of operating results prior to the end of the quarter -more- extremely uncertain; weak economic conditions worldwide which may continue to affect the overall demand for software and services, which has resulted in and could continue to result in decreased revenues or lower revenue growth rates; changes in revenue mix and seasonality; our ability to deliver our products on the distributed systems platform; dependence on revenues from our installed base; continued demand for additional mainframe MIPS capacity; expansion of our international organizations; and our ability to manage our growth. Information about potential factors that could affect the Company's financial results is included in the Company's Form 10K filed on April 29, 2003. SERENA assumes no obligation to update the forward-looking information contained in this press release. Trademarks ChangeMan and StarTool are registered trademarks of SERENA Software Inc. Serena is a trademark of SERENA Software, Inc. All other products or company names mentioned are used for identification purposes only, and may be trademarks of their respective owners. (C)2003 SERENA Software, Inc. All Rights Reserved. - FINANCIAL TABLES TO FOLLOW - -more- SERENA Software, Inc. Condensed Consolidated Statements of Income (In thousands, except per share data) (Unaudited) Three Months Ended April 30, ---------------- 2003 2002 ------- ------- Revenue: Software licenses $10,852 $ 9,651 Maintenance 11,911 10,775 Professional services 1,604 1,620 ------- ------- Total revenue 24,367 22,046 ------- ------- Cost of revenue: Software licenses 212 250 Maintenance 1,504 1,371 Professional services 1,766 1,422 ------- ------- Total cost of revenue 3,482 3,043 ------- ------- Gross profit 20,885 19,003 ------- ------- Operating expenses: Sales and marketing 6,653 6,364 Research and development 3,039 2,920 General and administrative 1,740 1,709 Stock-based compensation -- 11 Amortization of intangible assets 1,081 1,146 ------- ------- Total operating expenses 12,513 12,150 ------- ------- Operating income 8,372 6,853 Interest and other income, net 1,005 1,197 ------- ------- Income before income taxes 9,377 8,050 Income taxes 3,563 3,059 ------- ------- Net income $ 5,814 $ 4,991 ======= ======= Net income per share: Basic $ 0.14 $ 0.12 ======= ======= Diluted $ 0.14 $ 0.12 ======= ======= Weighted average shares used in per share calculations: Basic 40,450 40,168 ======= ======= Diluted 40,918 40,661 ======= ======= Non-U.S. GAAP Financial Information: Operating income, excluding intangibles amortization $ 9,453 $ 7,999 ======= ======= Net Income, excluding intangibles amortization $ 6,895 $ 6,137 ======= ======= Net income per share: Diluted, excluding intangibles amortization $ 0.17 $ 0.15 ======= ======= Reconciliation of U.S. GAAP to Non-U.S. GAAP Financial Information: U.S. GAAP operating income $ 8,372 $ 6,853 Add back: Amortization of intangible assets 1,081 1,146 ------- ------- Non-U.S. GAAP operating income $ 9,453 $ 7,999 ======= ======= U.S. GAAP net income $ 5,814 $ 4,991 Add back: Amortization of intangible assets 1,081 1,146 ------- ------- Non-U.S. GAAP net income $ 6,895 $ 6,137 ======= ======= -more- SERENA Software, Inc. Condensed Consolidated Balance Sheets (In thousands) (Unaudited) April 30, January 31, 2003 2003 -------- ----------- Assets Current assets Cash and cash equivalents $115,936 $105,402 Short-term investments 24,157 37,672 Accounts receivable, net 14,123 16,514 Deferred taxes 6,549 6,549 Prepaid expenses and other current assets 1,898 744 -------- -------- Total current assets 162,663 166,881 Long-term investments 55,491 48,374 Property and equipment, net 2,831 3,078 Deferred taxes 561 561 Intangible assets, net 44,279 45,360 Other assets 265 269 -------- -------- Total assets $266,090 $264,523 ======== ======== Liabilities and Stockholders' Equity Current liabilities: Accounts payable $ 738 $ 533 Income taxes payable 7,786 7,921 Accrued expenses 8,201 8,266 Deferred revenue 27,924 26,010 -------- -------- Total current liabilities 44,649 42,730 Deferred revenue, net of current portion 9,168 8,373 Deferred taxes 458 458 -------- -------- Total liabilities 54,275 51,561 Stockholders' equity: Total stockholders' equity 211,815 212,962 -------- -------- Total liabilities and stockholders' equity $266,090 $264,523 ======== ======== # # #